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Zacks Investment Ideas feature highlights: Adobe and Salesforce

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For Immediate Release

Chicago, IL – January 9, 2026 – Today, Zacks Investment Ideas feature highlights Adobe (ADBE - Free Report) and Salesforce (CRM - Free Report) .

2 Beaten-Down Tech Stocks Primed for a 2026 Rebound

Technology continued its dominance throughout 2025, with the AI frenzy painting a rosy picture for 2026 as well. But while 2025 was a strong period for many, several well-known tech companies – Adobe and Salesforce – didn't join the party, declining roughly 20% a piece.

Can 2026 be a rebound year for the once high-flying stocks?

Adobe Reports Double Digit Growth

Adobe's core products include Photoshop, Illustrator, Premiere Pro, Acrobat, and more. Notably, ADBE is placing a big emphasis on cloud delivery and AI-driven features, which enhance product value by embedding automation and generative capabilities into everyday workflows.

It's important to note that customers become accustomed to Adobe's products, making it hard to leave. Bullish demand for its AI-driven tools was clear in its latest quarterly release, with Adobe posting record Q4 sales. Its broader FY25 was also strong, underpinned by broad-based momentum across its segments that led to strong annual recurring revenue (ARR) growth.

Below is a chart illustrating the company's sales on a quarterly basis. Keep in mind that ADBE has posted double-digit percentage YoY sales growth rates in nine consecutive quarters, reflecting its attractive offerings.

Valuation isn't overly rich like some others involved in the AI frenzy, with the current 14.2X forward 12-month earnings multiple reflecting nearly a 40% discount relative to the S&P 500. Our consensus estimates suggest 12% adjusted EPS growth in its current year (FY26) and 13.4% in FY27, supporting the valuation picture.

Salesforce Raises Sales Outlook

Salesforce is the world's leading AI-powered Customer Relationship Management (CRM - Free Report) platform, providing cloud-based software for businesses to manage customer data, automate sales, marketing, and service, and build stronger customer connections.

Like ADBE, CRM's sticky nature also provides it a nice benefit in that it's difficult for its customers to leave once they get accustomed to its offerings. Strong demand was reported in its latest quarterly release, with its remaining performance obligation (RPO) soaring 12% YoY to $59.5 billion.

Its cash-generating abilities also saw a nice boost, with operating cash flow growing 17% YoY to $2.3 billion. The company also repurchased approximately $3.8 billion in shares and paid $395 million in dividends during the period, reflecting its shareholder-friendly nature.

Salesforce raised its FY26 sales guidance following the release, adding to the positivity. The favorable guide helped reverse a negative sales revisions trend, as shown below. CRM's sales are forecasted to grow 9.5% YoY in its current fiscal year.

Bottom Line

While out of favor throughout 2025, the stage could be setting up nicely for Adobe and Salesforce to bounce back in the new year, with recent quarterly results revealing nice momentum.

Their exposure to the AI frenzy is also notable, which will undoubtedly continue dominating headlines throughout 2026. Companies are clamoring for the new offerings, as seen in both ADBE's and CRM's recent sets of quarterly results.

Both stocks deserve a close eye in the new year, reflecting great 'comeback' stories after a forgettable 2025.

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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.


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